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FTSE 100 plunges on Grexit fears

Published: 12:38 29 Jun 2015 EDT

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An attempted rally in the afternoon ran out of steam at the death, leaving the top-share index in a deep hole.

The FTSE 100 finished down 133 at 6,620 with investors gripped by concerns over ramifications of the latest actions by the Greek government.

Greece has called a referendum on reform proposals by the International Monetary Fund (IMF) and other creditors after refusing to accept them in talks in Brussels.

Greek banks are to remain closed today and capital controls will be imposed, Prime Minister Alexis Tsipras revealed on Sunday.

It followed news that the European Central Bank (ECB) won’t increase emergency funding to the country, which is due to repay around £1.1bn to the IMF on Tuesday. Default would move it closer to ejection from the euro - the so-called “Grexit”.

Predictably, holiday firms got it in the neck, especially after last week’s terrorist attack in Tunisia, with TUI (LON:TUI), down 7.3%, hardest hit of all the blue-chips. Sector peer Thomas Cook (LON:TCG) was down 3.9% while hotels group tumbled 93p to 548p.

Outside of the FTSE 350, investment firm Armadale Capital (LON:ACP) was the best performing stock as the implied value of its investment in Mine Restoration Investment (MRI) has been underpinned by MRI raising funds by placing shares at ZAR0.07 a share.

At that price Armadale’s stake in MRI is worth around £910,000, prompting market makers to bump up the share price of Armadale by 41.5% to 7.25p.

Another company going well after share placing news was Active Energy (LON:AEG), up 12.2% at 5.50p. The company has raised £1mln by placing shares at 5p a pop with fund manager Ruffer to meet rising MDF demand in Turkey.

Milestone Group (LON:MSG) was also up 12.5%. The media and tech firm saw a step up in revenues in its latest half year. The figure, at £260,000 for the six months to end March, exceeded the revenue for all of 2014 of £157,000.

On the downside, Nova Resources (LON:NOVA) was down 41.8%. The company reported a loss of £2.92mln for 2014, versus a loss of £477,699 the year before.

Tool hire firm HSS Hire Group (LON:HSS) lost a quarter of its value, as it said trading in the second quarter was marginally below expectations.

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